If I were starting my investment journey today, I would focus on businesses that are relatively easy to understand and have clear reasons to keep growing over many years.
That can make it easier to stay focused on the long term when share prices inevitably move around.
Here are three ASX shares I think could be good places for beginners to start looking.
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NextDC Ltd (ASX: NXT)
NextDC would be my first pick for exposure to one of the biggest technology trends of the next decade.
The company develops and operates data centres. These facilities provide the power, cooling, security, and connectivity needed to run cloud computing and increasingly demanding artificial intelligence (AI) workloads.
I think that makes the long-term opportunity fairly straightforward to understand. As companies use more cloud services and AI becomes more widely adopted, considerably more computing infrastructure will be needed.
NextDC is positioning itself directly in the middle of that expansion. It is already one of Australia's leading data centre providers and is expanding into Asia, including with its first AI-ready facility in Kuala Lumpur.
The company is also developing facilities specifically designed for AI workloads, including its S6 Sydney data centre.
NextDC shares can be volatile, particularly because building data centres requires enormous investment. For a beginner with a long investment horizon, though, I think its exposure to the growth of AI and cloud computing makes it an interesting share to consider.
REA Group Ltd (ASX: REA)
REA Group is another business where I think the investment case is easy to follow.
Its main asset is realestate.com.au, which Australians use to search for homes, research property, and connect with real estate agents.
That gives REA an important position between property buyers, sellers, and agents. The company has also expanded beyond property advertisements into areas such as property data, valuations, and home financing.
I think that creates plenty of room for the business to keep becoming more involved in the property journey.
Technology can also make the platform more valuable over time. REA uses large amounts of property data to personalise the experience for users and develops automated property valuations using machine learning.
For a beginner investor, I like that REA operates a service many Australians already know and use. It also has several ways to keep expanding without needing to completely reinvent what made the business successful in the first place.
TechnologyOne Ltd (ASX: TNE)
My final pick is TechnologyOne.
This ASX share develops enterprise software used by organisations such as councils, government departments, universities, and other large institutions. Its software helps customers manage important functions across areas, including finance, payroll, property, and student administration.
I think this is an attractive market because these organisations can rely on the same systems for many years.
TechnologyOne also develops its software specifically for the industries it serves. Its education platform, for example, is designed around the needs of universities and TAFEs rather than being a generic product adapted afterwards.
That gives the company plenty of scope to win more customers in Australia and continue expanding internationally.
For someone starting out, I think TechnologyOne offers exposure to the long-term shift towards cloud software through a well-established Australian business.
Foolish Takeaway
NextDC, REA Group, and TechnologyOne give beginners three ways to invest in long-term growth.
I like NextDC for AI infrastructure, REA for its position in Australian property, and TechnologyOne for the continuing move towards cloud-based business software.
I would be comfortable buying any of the three with the intention of holding for many years.
